Restaurant Groups Renew Push for Coronavirus Relief Aid

July 16, 2020 by Dan McCue

WASHINGTON – A week before Congress turns its attention to the next coronavirus relief bill, advocates for the nation’s restaurants are urging lawmakers to include a number of provisions to specifically bolster the struggling industry.

“In just the past two weeks alone, state and local government mandates have shut down almost 100,000 restaurants,” said Sean Kennedy, spokesman for the National Restaurant Association, in a letter sent Wednesday to House Speaker Nancy Pelosi, House Minority Leader Kevin McCarthy, Senate Majority Leader Mitch McConnell and Senate Minority Leader Chuck Schumer.

“Many are advising us they cannot survive this ongoing on/off approach to operations and will permanently close,” Kennedy said.

Accompanying the letter was “Blueprint for Restaurant Revival,” a comprehensive policy and legislative plan outlining specific and immediate action the association believes the federal government should take to stabilize the industry in the short-term and set the foundation for long-term rebuilding.

The Blueprint focuses on three main areas where Congress can act to make significant changes that would support restaurants of every size and operational model in communities across the country. These areas include:

Short-Term Relief to Restart the Restaurant Industry

  • Create a Restaurant Recovery Fund for structured relief to help restaurants get the liquidity they need to adapt, rehire and eventually reopen. This includes passage of the RESTAURANTS Act proposed by the Senate.
  • Build on the success of PPP by enacting a second round of application eligibility to initial eight-week loan recipients and make other changes to help extend and sustain this successful program.
  • Make PPP loans tax deductible so that small businesses can deduct eligible expenses paid with a forgiven PPP loan, and eliminate the substantial tax liability many face for taking these loans in the first place.
  • Establish a long-term loan program beyond PPP so restaurants can rehire, retrain and retain valued employees by providing up to six-months of operating costs and additional support.
  • Expand the Employee Retention Tax Credit (ERTC) to help restaurants get support after a PPP loan has run out.
  • Improve Economic Injury Disaster Loans (EIDLs) by replenishing funding for EIDLs and advance grants to support businesses with major revenue reductions due to COVID-19.
  • Provide customer and employee wellness tax credits to help with significant capital investments for employee and guest safety.
  • Address Business Interruption insurance claims for small businesses with a federal backstop to cover losses due to a pandemic so that insurance remains available and affordable.
  • Provide Liability Protection for American Businesses because COVID-19 is a global pandemic and is not caused or spread by any one type of business or employee. Congress should enact temporary and targeted protections to stem frivolous or fraudulent lawsuits, but allow claims based on willful misconduct by bad actors.

Ensure Stability of America’s Food Supply Chain from Farm to Table

  • Prioritize testing + vaccine distribution for food supply chain employees (after health care, first responders and vulnerable populations) to help the entire food and restaurant industry continue growing, selling and serving healthy food even in times of crisis.
  • Enact payroll tax relief for essential employees to help keep frontline workers in vital sectors on the job and serving the public.

Help Restaurants Support At-Risk Communities

  • Provide support for restaurants feeding vulnerable populations by providing incentives and payment when restaurants partner with government and non-profits to prepare meals for seniors, children and other vulnerable populations.
  • Broaden access to restaurant meals for low-income Americans by creating state-run programs that increase food access points during times of crisis and by expanding the population of people eligible for restaurant meal service via the Supplemental Nutrition Assistance Program (SNAP).

The National Restaurant Association letter arrived on Capitol Hill as a number of states have begun re-shuttering restaurants and bars in the face of a surge in confirmed cases of the coronavirus.

On Monday, California Gov. Gavin Newsom ordered the closure of indoor businesses across the state, including restaurants, bars, wineries, movie theaters, zoos and museums as coronavirus cases continue to rise there.

California is now one of 11 states that have rolled back or partially rescinded orders allowing restaurants and bars to reopen as the pandemic appeared to wane in late May and early June.

In addition to California, they include Arizona, Colorado, Florida, Idaho, Louisiana, Michigan, Nevada, Pennsylvania, Tennessee, and Texas.

Most of the new closure orders are restricted to counties within the states that are seeing a spike in cases. In other instances, restaurants are being forced to close dine-in service or to restrict their occupancy to 50%.

In response to Gov. Newsom’s announcement, Caroline Styne, a member of the Independent Restaurant Coalition advisory board, said, “California won’t be the last state to reverse or delay the return of independent restaurants and bars, and that’s exactly why Congress needs to pass a relief program for our industry.”

Styne, a chef and partner of the Los Angeles-based Lucques Group, went on to say “restaurants placing their first supply orders since March can’t turn the delivery trucks around.

“These re-closings are creating more debt for businesses that were just beginning to find their footing after accumulating four months of unpaid bills,” she said. “Outdoor dining isn’t a long-term solution as not all independent restaurants have the ability or resources to seat customers outside.

“Members of Congress from states closing down dining rooms need to support the RESTAURANTS Act, and give their independent restaurants a fighting chance at re-opening when it’s safe to do so,” she concluded.

Introduced by  Sen. Roger Wicker, R-Miss., and Rep. Earl Blumenauer, D-Ore., the RESTAURANTS Act would establish a $120 billion fund for independent food service or drinking establishments devastated from the coronavirus pandemic.

The bill, dubbed the Real Economic Support that Acknowledges Unique Restaurant Assistance Needed to Survive Act, or RESTAURANTS Act, would provide grants to restaurants that are not publicly traded and have $1.5 million or less in revenue under normal circumstances.

The grant can be used to cover payroll, benefits, mortgage, rent, protective equipment, food, or other costs.

“The restaurant industry is one of tenacity, innovation, and dedication to serving our community,” said the National Restaurant Association’s Kennedy. “We are looking to Congress not only for support for our short-term survival, but to create a long-term framework that sustains our role as a key part of the food supply chain for the millions of families that rely on us for nourishment.”

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